MERGER AGREEMENT
This MERGER AGREEMENT (the "AGREEMENT") is made and entered into as
of May 20, 2002 by and between Atlas Holdings Inc., a New Jersey corporation
("SELLER"), and Valesc Inc., a Delaware corporation ("BUYER").
WHEREAS, the Board of Directors of Seller and Buyer believe that it
is in the best interest of their respective companies and in the best interest
of the shareholders of their respective companies that Seller and Buyer combine
to form a single entity through the merger of Seller into Buyer (the "MERGER"),
and in furtherance thereof, have approved the Merger;
WHEREAS, the shareholders of the Seller have been notified of the
Merger in accordance with the New Jersey Business Corporation Law ("NEW JERSEY
LAW"), provided with drafts of this Agreement and the Agreement and Plan of
Merger, and upon due consideration have approved the Merger by unanimous
consent;
WHEREAS, pursuant to the Merger, among other things, (a) all issued
and outstanding shares of common stock of Seller (the "SELLER'S STOCK") shall be
converted into the right to receive an aggregate of 8,458,000 shares of the
common stock of Buyer (the "BUYER'S STOCK"), at the rate set forth herein, and
(b) 8,458,000 shares of common stock of Buyer owned by Seller prior to the
Merger will be cancelled;
WHEREAS, each of the shareholders of Seller shall have executed an
investment letter to Buyer containing certain securities law representations as
a condition to the closing of the Merger;
WHEREAS, Seller and Buyer desire to make certain representations and
warranties and other agreements in connection with the Merger.
NOW THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. THE MERGER. At the Effective Time (as defined in Section 2), and
subject to and upon the terms and conditions of this Agreement, the Agreement
and Plan of Merger attached hereto as EXHIBIT A (the "AGREEMENT AND PLAN OF
MERGER") and the applicable provisions of the Delaware General Corporation Law
("DELAWARE LAW") and New Jersey Law, Seller shall be merged with and into Buyer,
the separate corporate existence of Seller shall cease, and Buyer shall continue
as the surviving corporation of the Merger. Buyer, as the surviving corporation
after the Merger, is sometimes referred to herein as the "SURVIVING
CORPORATION".
2. CLOSING; EFFECTIVE TIME. The closing of the transactions
contemplated by this Agreement (the "CLOSING ") shall take place as soon as
practicable after the shareholders of Seller shall have approved such
transactions, but in no event later than 20 days after the date hereof. In
connection with the Closing, the parties shall cause the Merger to be
consummated by filing the Agreement and Plan of Merger with the Department of
State of the States of Delaware and New Jersey in accordance with the relevant
provisions of Delaware Law and New Jersey Law (the time of such filings being
the "EFFECTIVE TIME").
3. EFFECT OF THE MERGER. At the Effective Time, the effect of the
Merger shall be as provided in this Agreement, the Agreement and Plan of Merger
and the applicable provisions of Delaware Law and New Jersey Law. At the
Effective Time, all of the property, rights, privileges and powers of Seller and
Buyer shall vest in the Surviving Corporation, and all debts, liabilities and
duties of Seller and Buyer shall become the debts, liabilities and duties of the
Surviving Corporation.
4. CERTIFICATE OF INCORPORATION; BY-LAWS.
(a) At the Effective Time, the Certificate of Incorporation of Buyer
shall be the Certificate of Incorporation of the Surviving Corporation until
thereafter amended as provided by Delaware Law and such Certificate of
Incorporation.
(b) At the Effective Time, the By-laws of Buyer, as in effect
immediately prior to the Effective Time, shall be the By-laws of the Surviving
Corporation until thereafter amended as provided by Delaware Law, the
Certificate of Incorporation of the Surviving Corporation and such By-laws.
5. DIRECTORS AND OFFICERS. At the Effective Time, the directors of
Seller immediately prior to the Effective Time shall be the directors of the
Surviving Corporation, and the officers of Seller immediately prior to the
Effective Time shall be the officers of the Surviving Corporation, in each case
until their respective successors are duly elected or appointed and qualified.
6. EFFECT ON CAPITAL STOCK.
(a) By virtue of the Merger and without any action on the part of
Buyer, Seller or their respective shareholders, each issued and outstanding
share of the Seller's Stock shall be converted into the right to receive the Per
Share Consideration (as defined below), payable to the holder thereof, upon
surrender of the certificate formerly representing such share in the manner
provided in Section 7. All such shares of the Seller's Stock, when so converted,
shall no longer be outstanding and shall automatically be canceled and retired
and shall cease to exist, and each holder of a certificate representing any such
shares of the Seller's Stock shall cease to have any rights with respect
thereto, except the right to receive the Per Share Consideration therefor upon
the surrender of such certificate in accordance with Section 7. SCHEDULE A sets
forth, as of the date hereof, by holder, the number of outstanding shares of the
Seller's Stock and the holders thereof, and the number of shares of Buyer's
Stock each will receive pursuant to the Merger. For purposes of this Agreement,
"Per Share Consideration" means 986.12568 shares of Buyer's Stock for each share
of Seller's Stock, for a total of 8,458,000 shares of Buyer's Stock to the
shareholders of Seller.
(b) Simultaneously with the conversion, 8,458,000 shares of Buyer's
Stock owned by Seller prior to the Merger (the "CANCELLED STOCK") will be
cancelled.
7. SURRENDER OF CERTIFICATES; EXCHANGE PROCEDURE. Promptly after the
Effective Time (a) all of the shareholders of Seller shall deliver to the
Surviving Corporation the certificates (each, a "STOCK CERTIFICATE") that,
immediately prior to the Effective Time, represented outstanding shares of the
Seller's Stock, whose shares were converted into the right to receive the Per
Share Consideration pursuant to Section 6, and (b) the Seller shall deliver to
the Surviving Corporation the Stock Certificates representing the Cancelled
Stock. Upon surrender of a Stock Certificate representing the Seller's Stock for
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cancellation, along with a duly executed stock power, to the Surviving
Corporation, the holder of such Stock Certificate shall be entitled to receive
in exchange therefor the Per Share Consideration, which such holder has the
right to receive pursuant to Section 6, and the Stock Certificate so surrendered
shall be canceled. Until so surrendered, each Stock Certificate that, prior to
the Effective Time, represented shares of the Seller's Stock will be deemed,
from and after the Effective Time for all corporate purposes other than for the
payment of dividends, to evidence the right to receive the Per Share
Consideration in accordance with Section 6.
8. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller is a corporation
duly organized, validly existing and in good standing under the laws of the
State of New Jersey, and has the power and authority to own and use its assets
and to carry on its business as it is now conducted. This Agreement has been
duly executed and delivered by Seller and constitutes the legal, valid and
binding obligation of Seller in accordance with its terms. The execution,
delivery and performance of the Agreement will not conflict with, result in a
breach of, or entitle any party to terminate or call a default with respect to
any contract, agreement, instrument, judgment, order, decree, law, rule or
regulation applicable to Seller or by which Seller is bound. The execution,
delivery and performance of this Agreement will not contravene or violate or
constitute a breach of the terms of Seller's Certificate of Incorporation or
By-laws.
9. BUYER'S REPRESENTATIONS AND WARRANTIES.
(a) Buyer is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and has the power and
authority to own and use its assets and to carry on its business as it is now
conducted. This Agreement has been duly executed and delivered by Buyer and
constitutes the legal, valid and binding obligation of Buyer in accordance with
its terms. The execution, delivery and performance of the Agreement will not
conflict with, result in a breach of, or entitle any party to terminate or call
a default with respect to any contract, agreement, instrument, judgment, order,
decree, law, rule or regulation applicable to Buyer or by which Buyer is bound.
The execution, delivery and performance of this Agreement will not contravene or
violate or constitute a breach of the terms of Buyer's Certificate of
Incorporation or By-laws.
(b) All of the outstanding shares of the Buyer's Stock have been duly
authorized and are fully paid and nonassessable. The Buyer's Stock to be issued
as part of the Per Share Consideration shall be duly authorized and fully paid
and nonassessable.
10. DELIVERIES AND CONDITIONS TO CLOSING. At Closing, Seller shall
have delivered to the Surviving Corporation the Stock Certificates representing
(a) all of the issued and outstanding shares of the Seller's Stock and (b) the
Cancelled Stock, together with duly executed stock transfer powers in favor of
the Surviving Corporation or such other endorsements, assignments or other good
and sufficient instruments of sale, transfer and assignment, to transfer to the
Surviving Corporation good and marketable title to the Seller's Stock and the
Cancelled Stock free and clear of all liens, restrictions, security interests
and encumbrances whatsoever. It shall be a condition to Closing that Seller
shall have delivered to the Surviving Corporation investment letters from each
of Seller's shareholders. Also, at Closing, the Surviving Corporation shall have
delivered to Seller the Per Share Consideration.
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11. SURVIVAL. All representations and warranties made by the parties
herein shall survive the Closing.
12. TERMINATION. At any time prior to Closing, this Agreement may be
terminated and the Merger may be abandoned (a) by mutual consent of the parties,
duly authorized by the Board of Directors of Seller and Buyer; or (b) by Seller,
if Seller shall not have received the approval of the shareholders of Seller to
consummate the transactions contemplated herein.
13. EFFECT OF TERMINATION. In the event of the termination of this
Agreement as provided in Section 12, this Agreement shall become void and there
shall be no liability or obligation on the part of Buyer or Seller or their
respective officers, directors, shareholders or affiliates, except as a result
of any breach by a party hereto of any of its representations or warranties
contained in this Agreement.
14. INDEMNIFICATION. Each party shall indemnify, defend and hold the
other party and its officers, directors, shareholders and affiliates, and all of
their heirs, personal representatives, successors and assigns, harmless from and
against all liability, loss, claim or damage, together with all reasonable costs
and expenses related thereto (including reasonable legal fees and expenses),
suffered, sustained, incurred or required to be paid by any of them, by reason
of or arising out of or relating to such party's breach of the representations
and warranties contained in this Agreement.
15. NOTICES. All notices, demands and other communications to be made
hereunder shall be given in writing and sent to the addresses set forth on the
signature page hereto, and shall be deemed to have been duly given if personally
delivered or sent by confirmed facsimile transmission, recognized overnight
courier service which provides a receipt against delivery, or by certified mail,
postage prepaid, return receipt requested. Notice shall be deemed effective if
personally delivered, when delivered, if sent via overnight delivery, on the
first business day after being sent, and if mailed, at midnight on the third
business day after deposit in the U.S. mail.
16. GOVERNING LAW. This Agreement has been made, executed and
delivered, and is to be governed, construed and enforced, in accordance with the
laws of the State of Delaware.
17. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
18. HEADINGS. The headings in this Agreement are for reference only
and shall not affect the interpretation of this Agreement.
19. ENTIRE AGREEMENT. This Agreement and the documents attached as
exhibits or schedules hereto, when executed will contain the entire agreement
and understanding between the parties hereto with respect to the subject matter
hereof and thereof, and supersede all prior written and oral negotiations,
agreements and writings.
20. MODIFICATION. This Agreement may be amended, superseded,
terminated or extended, and the terms hereof may be waived, only by a written
instrument signed by all of the parties or, in the case of a waiver, signed by
the party waiving compliance.
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21. PROVISIONS SEVERABLE. The provisions of this Agreement are
independent of and severable from each other. No provisions will be affected or
rendered invalid or unenforceable by virtue of the fact that for any reason any
one or more of any of the provisions hereof may be invalid or unenforceable in
whole or in part.
22. COUNTERPARTS. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original, but all such counterparts shall together constitute one
and the same instrument. Each counterpart may consist of a number of copies
hereof each signed by less than all, but together signed by all of the parties
hereto.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first written above.
VALESC INC.
/s/ Xxxxxx Xxxxx
By: ----------------
Name: Xxxxxx Xxxxx
Title: President
c/x Xxxxx & Associates, P.C.
00 Xxxx 00xx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
ATLAS HOLDINGS INC.
/s/ Xxxxxx Xxxxx
By: ------------------
Name: Xxxxxx Xxxxx
Title: President
0000 Xxxx Xxxx, Xxxxx 000X
Xxxxx, XX 00000
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EXHIBIT A
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AGREEMENT AND PLAN OF MERGER
Agreement and Plan of Merger (the "PLAN") approved on April 25, 2002
by Valesc Inc., a Delaware corporation (the "SURVIVING CORPORATION"), and by its
Board of Directors on said date, and approved by Atlas Holdings Inc., a New
Jersey corporation ("ATLAS"), and by its Board of Directors on said date, under
which Atlas will merge with and into the Surviving Corporation (the "MERGER")
pursuant to the applicable provisions of the Delaware General Corporation Law
and the New Jersey Business Corporation Act.
1. MERGER OF ATLAS INTO THE SURVIVING CORPORATION. On the Effective
Date (as defined in paragraph 7 hereof), Atlas will merge with and into the
Surviving Corporation and the separate existence of Atlas will cease. The
Surviving Corporation will be the Surviving Corporation and will continue its
existence under Delaware law.
2. CERTIFICATE OF INCORPORATION OF THE SURVIVING COOPERATION. At the
Effective Date (as defined below), the Certificate of Incorporation of Buyer, as
in effect immediately prior to the Effective Date, shall be the Certificate of
Incorporation of the Surviving Corporation until thereafter amended as provided
by Delaware law and such Certificate of Incorporation.
3. BY-LAWS OF THE SURVIVING CORPORATION. At the Effective Date, the
By-laws of Buyer, as in effect immediately prior to the Effective Date, shall be
the By-laws of the Surviving Corporation until thereafter amended as provided by
Delaware law, the Certificate of Incorporation of the Surviving Corporation and
such By-laws.
4. DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION. At the
Effective Date, the directors of Buyer immediately prior to the Effective Date
shall be the directors of the Surviving Corporation, and the officers of Buyer
immediately prior to the Effective Date shall be the officers of the Surviving
Corporation, in each case until their respective successors are duly elected or
appointed and qualified.
5. SHARES. On the Effective Date (a) upon surrender of the
certificates representing the Atlas shares, each issued and outstanding share of
the stock of Atlas will, by virtue of the Merger and without any action on the
part of the holder thereof, be exchanged for 986.12568 shares of common stock of
the Surviving Corporation, for a total of 8,458,000 shares of common stock of
the Surviving Corporation to the former Atlas shareholders, and (b) 8,458,000
shares of common stock of the Surviving Corporation owned by Atlas prior to the
Merger will be cancelled.
6. LIABILITIES AND OBLIGATIONS. On the Effective Date, the separate
existence of all parties to the Merger, except that of the Surviving
Corporation, shall cease. All of the property, real, personal and mixed, and
contracts of the Surviving Corporation and Atlas, and all debts due on whatever
account to the Surviving Corporation and Atlas, including choses in action,
shall be deemed to be transferred to and vested in the Surviving Corporation
without further action, and the title to any real estate, or any interest
therein, vested in the Surviving Corporation and Atlas shall not revert or be in
any way impaired by reason of the Merger. The Surviving Corporation shall be
responsible for all of the liabilities of the Surviving Corporation and Atlas.
Liens upon the property of the Surviving Corporation and Atlas shall not be
impaired by the Merger and any claim existing or action or proceeding pending by
or against the Surviving Corporation or Atlas may be prosecuted to judgment as
if the Merger had not taken place, or the Surviving Corporation may be proceeded
against or substituted in place of Atlas. Any taxes, penalties and public
accounts claimed against the Surviving Corporation and Atlas but not settled,
assessed or determined prior to the Effective Date shall be settled, assessed or
determined against the Surviving Corporation and, together with interest
thereon, shall be a lien against the franchises and property, both real and
personal, of the Surviving Corporation.
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7. APPROVAL, FILING AND EFFECTIVENESS.
----------------------------------
(a) The Plan herein made and approved shall be submitted to the
shareholders of Atlas for their approval or rejection in the manner prescribed
by the provisions of the New Jersey Business Corporation Act, and the Merger
shall be authorized in the manner prescribed by the laws of the jurisdiction of
organization of the Surviving Corporation.
(b) After this Plan has been duly approved in the manner required by
law and if it is not terminated in accordance with paragraph 8 hereof, Atlas and
the Surviving Corporation hereby stipulate that they will cause to be executed
and filed and/or recorded any document or documents prescribed by the laws of
the State of New Jersey and of the State of Delaware, and that they will cause
to be performed all necessary acts therein and elsewhere to effectuate the
Merger. The date of such filings will be the "Effective Date" of the Merger.
8. TERMINATION. This Plan may be terminated and the Merger abandoned
by action of the Board of Directors of the Surviving Corporation and the Board
of Directors of Atlas at any time prior to the Effective Date.
9. AUTHORIZATION. The Board of Directors and the proper officers of
Atlas and of the Surviving Corporation, respectively, are hereby authorized,
empowered and directed to do any and all acts and things, and to make, execute,
deliver, file, and/or record any and all instruments, papers, and documents that
shall be or become necessary, proper, or convenient to carry out or put into
effect any of the provisions of this Plan or of the Merger herein provided for.
IN WITNESS WHEREOF, the parties hereto have duly executed this Plan
as of the date first written above.
VALESC INC.
By:__________________________
Name: Xxxxxx Xxxxx
Title: President
ATLAS HOLDINGS INC.
By:___________________________
Name: Xxxxxx Xxxxx
Title: President
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CERTIFICATION OF SECRETARY
The foregoing Agreement and Plan of Merger ("AGREEMENT") was adopted
by the constituent corporation surviving the merger, Valesc Inc., by action of
its Board of Directors and without any vote of its stockholders pursuant to
subsection (f) of Section 251 of the General Corporation Law of the State of
Delaware. The Secretary of Valesc hereby certifies that the Agreement has been
adopted pursuant to the first sentence of said subsection (f) and that the
conditions specified in that sentence have been satisfied.
Dated: May 17, 2002
By:_____________________________
Xxxxxx Xxxxx
Secretary of Valesc Inc.
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SCHEDULE A
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NAME ATLAS SHARES VALESC SHARES
Xxxxxx Xxxxx 3,560.33 3,510,936.15
Xxxxxx Xxxxx 2,140.33 2,110,637.67
Xxxxxxx Xxxxxx 2,140.33 2,110,637.67
Xxxxxx Xxxxx 419.33 413,515.37
Xxxxx Xxxxx 146.67 144,631.77
Xxxxxx Xxxxxxx 39.5 38.951.96
Xxxxx Xxxxxxx 35.0 34,514.40
Xxxxxxxx Xxxxx 31.5 31,062.96
Xxxx Xxxxxxx 31.5 31,062.96
Xxxxxx Xxxxx 16.5 16,271.07
Xxxxxx Xxxxx 8.0 7,889.01
Xxx Xxxxxx 8.0 7,889.01
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